Abu Dhabi conglomerate International Holding Company (IHC) on Tuesday said it increased stake in Adani Enterprises Ltd to above 5%, days after it sold its stakes in two other Adani Group companies..
"This strategic increase reflects IHC's conviction in the world leading incubation model of AEL and we believe that the inherent strength of Airports, Data Centers, Green Hydrogen, and various other verticals being incubated under AEL and that AEL is poised to uniquely capitalise on India’s robust growth journey. IHC continues to explore uniqueinvestment opportunities in India with the goal to maximise stakeholders’ return," said IHC in a press release. On Tuesday, Adani Enterprises' scrip on BSE closed 0.9% lower at Rs 2,390.
With the new investments, the value of IHC's holding in the Adani group's flagship company now stands at around Rs 14,000 crore, based on Tuesday's closing price of its shares, the Adani Group said separately in a statement.
Adani Group spokesperson said: “We are delighted with IHC's decision to enhance its investment in Adani Enterprises Ltd (AEL), which further validates AEL's standing as a global leader in incubating new businesses, particularly in sustainable infrastructure, developing global aviation infrastructure and equitable energy transition. We see IHC’s increased stake as a ringing endorsement of our robust capex plans, governance and transparency. This inter-generational relationship with IHC reflects well on India’s dynamic growth potential and offers substantial returns to our stakeholders.”
Last month, IHC said in a stock exchange notice that its subsidiaries have entered an agreement with a buyer to "dispose of" its foreign direct investment in Adani Green Energy Ltd and Adani Energy Solutions (formerly Adani Transmission).
The move, as part of IHC's "portfolio rebalancing strategy", would see its subsidiaries Green Energy and Green Transmission offload their 1.26% stake in Adani Green and 1.41% stake in Adani Energy Solutions, respectively, according to Bombay Stock Exchange data.
The company's disclosure to the market aligns with its strategy to rebalance its investment portfolio, IHC said. "Our partnership with Adani and dedication to the Indian market remain steadfast."
Overseas investors such as the IHC have backed Adani in the face of allegations raised by US short-seller Hindenburg Research in January that the apples-to-airports conglomerate engaged in stock manipulation and had amassed significantly high debt.
The Adani Group has denied all allegations and the Indian markets regulator is investigating the matter under orders of Supreme Court.
IHC had in April 2022 invested about $500 million each in renewables arm Adani Green Energy and power company Adani Transmission, and a further $1 billion in the group's flagship Adani Enterprises.
At that time, IHC's chief executive Syed Basar Shueb described the decision to back Adani as a ''long-term investment in India''.
Last month, French oil major Total Energies invested $300 million in Adani Green Energy to form a joint venture for development of wind and solar farms.
And sovereign fund the Qatar Investment Authority (QIA) invested $500 million for a 2.7% stake in Adani Green Energy.
In August, investment firm GQG Partners bought an 8.1% stake in Adani Power for $1.1 billion through block trades.